Question: PART B - Question 4 (10 marks ) Fife , Inc . has the following account balances at December 31, 2005 : Accounts Receivable $185,600

PART B - Question 4 (10 marks ) Fife , Inc . has the following account balances at December 31, 2005 : Accounts Receivable $185,600 and Allowance for Doubtful Accounts $1,600 (credit balance ). Fife uses the aging of accounts receivable e to estimate bad debts . The following aging schedule reflects the situation at year -end : Estimated Age Group Uncollectible Account Age Balance Percentage Current $ 96,000 2.0 1-30 days past due 64,000 5.0 31 -60 days past due 16,000 15.0 61 -90 days past due 6,400 35.0 Over 90 days past due 3,200 45.0 (1) Calculate the amount of the Allowance for Doubtful Accounts that should appear on the December 31 , 20X5 , balance sheet . (2) Prepare the journal entry to record 20X5 bad debts expense SOLUTIONS 1. Calculate the amount of the Allowance for Doubtful Accounts

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